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Investor Exuberance

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"Hedge Funds' Risky Asset Surge: A Closer Look"

Originally Published 2 years ago — by MarketWatch

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Source: MarketWatch

Hedge funds have increased their risk appetite and are piling into risky assets, according to Société Générale's risk indicator tracking hedge fund positions. The indicator, known as SG MARI, is at its highest level since 2018, indicating a risk-on sentiment among hedge funds. However, the current level is still below the zone of investor exuberance. Historically, surges in SG MARI have been followed by significant drops, suggesting that hedge funds may back out of their positions.